Australia growing solidly, Swan says

EURO FALLOUT:The Australian treasurer called for more action from European leaders, and said that the government would invest in infrastructure and skills

Bloomberg

Christmas shoppers are reflected in the stainless steel cladding of a shopping center in Sydney, Australia, on Thursday. Australia’s mining-powered economy grew 1 percent during the September quarter in a result hailed by the government as exceptional, given the ongoing global turmoil.

Photo: AFP

Australia’s economy is “growing solidly” and capital expenditure by businesses is forecast to rise 32 percent to a record A$158 billion (US$161 billion) this financial year, Australian Treasurer Wayne Swan said yesterday.

“That spending, although a drag on productivity now, will increase our economy’s capacity down the track,” Swan said in his weekly economic note.

INVESTMENT

His office yesterday released an interim report on the tax treatment of losses for public comment in a move he said could “encourage investment in businesses that are struggling or that are just starting up.”

Australia, which was the only economy in the G10 to avoid a recession during the global credit crisis, expanded 1 percent in the third quarter, faster than earlier estimated.

The cut marked the Reserve Bank of Australia’s first consecutive easing since the depths of the world financial crisis in 2009 and reflected a worsening global outlook that is weighing on Australia’s exports.